Disseminated on behalf of Surge Battery Metals Inc.
Electric vehicles (EVs), energy storage systems (BESS), and clean energy technologies depend heavily on lithium. Yet even with fast-rising demand, the United States still produces far less lithium than it needs.
In 2024, U.S. production reached only about 25,000 tonnes of lithium carbonate equivalent (LCE) – roughly 2% of global supply, which totaled around 1.2 million tonnes. That output is enough for only about 158,000 Tesla Model 3 battery packs per year.
The gap between national demand and domestic production keeps widening. Most lithium used in the U.S. comes from imports, mainly from Chile, Australia, and China. This dependency exposes the country to supply disruptions, trade restrictions, and price volatility. If imports are interrupted, the U.S. battery and EV industries could face serious setbacks.
Growing Demand Creates a Structural Deficit
Global demand for lithium is growing quickly. Analysts expect it to quadruple by 2030 as more countries adopt EVs and build large-scale battery storage.
According to Katusa Research (2025), global lithium demand is projected to climb from 1.04 million tonnes in 2024 to 3.56 million tonnes by 2035 — a 3.5× increase. About 83% of that demand will come from EV batteries, while energy storage will account for another 11%.
Source: Katusa Research
Per the International Energy Agency, the U.S. alone may need over 625,000 tonnes of LCE per year by 2030, compared with only a small fraction produced domestically today.
Building new mines takes time – often 10 to 15 years from exploration to commercial production. This long timeline makes it difficult to ramp up supply fast enough to meet demand. Therefore, a lasting shortage is forming. If the U.S. does not accelerate new projects soon, it may depend on imports for decades.
Each EV battery pack uses large amounts of lithium. On average, an EV requires about 60 kilograms of LCE – or 8 to 10 kilograms per kilowatt-hour (kWh) of battery capacity. As automakers build more gigafactories, that adds up quickly.
Katusa’s data also shows that global EV sales jumped from 2 million in 2020 to 11 million in 2024, a 450% surge — and could exceed 60 million units per year by 2040, more than half of all cars sold globally.
Source: Katusa Research
The U.S. is expected to have 440 gigawatt-hours (GWh) of battery manufacturing capacity by 2025 and more than 1,000 GWh by 2030. That growth alone could double or triple national lithium demand.
Introducing the Nevada North Lithium Project
One company aiming to help close this gap is Surge Battery Metals. Its flagship asset, the Nevada North Lithium Project (NNLP) in Elko County, Nevada, is one of the few high-grade lithium clay deposits in the United States.
The project has an inferred resource of 11.24 million tonnes of LCE, grading about 3,010 ppm lithium, making it the highest-grade lithium clay resource in the country.
The project benefits from ideal logistics. NNLP is only 13 kilometers from major power lines and close to all-season roads. The Bureau of Land Management (BLM) has issued a Record of Decision and a Finding of No Significant Impact (FONSI), allowing expanded exploration over 250 acres. These factors make NNLP a leading U.S. candidate for large-scale lithium development.
How NNLP Helps Close the Supply Gap
Surge Battery Metals’ Nevada North project has features that position it well to help close America’s lithium gap. Its high grade and large resource size suggest it could deliver significant output once in production. Higher-grade deposits typically allow lower extraction costs and shorter payback periods.
Because NNLP already has key permits and environmental clearance, it may reach production faster than many early-stage peers. That speed is critical as EV demand accelerates and the U.S. targets more domestic battery manufacturing.
Just as important, NNLP supports U.S. policy goals for supply chain security. Producing lithium domestically reduces reliance on imports, helping stabilize supply and pricing for American automakers. It also supports the Inflation Reduction Act, which requires that most EV battery minerals come from North America or allied countries by 2027.
In March 2025, the U.S. government took direct equity stakes in several lithium ventures, including Lithium Americas’ Thacker Pass, signaling a strong federal commitment to reshoring critical mineral production. This policy backdrop reinforces projects like NNLP as part of a national security priority.
Strengthening NNLP Through Strategic Partnership
Moreover, Surge Battery Metals signed a joint venture letter of intent (LOI) with Evolution Mining (ASX: EVN), allowing Evolution to earn up to 32.5% ownership by funding C$10 million toward the Preliminary Feasibility Study (PFS) for the Nevada North Lithium Project (NNLP). Surge retains majority control and project management, keeping its long-term vision and stakeholder priorities front and center.
This partnership delivers big strategic value. By merging Surge’s lithium expertise and mineral rights with Evolution’s 75% stake in 880 acres of private land – and over 21,000 added acres nearby – the deal significantly increases the JV’s land position. The expanded acreage boosts the overall exploration area and brings in mineral rights in key southern zones, possible clay unit extensions to the north, and territory in historic mining districts and key drainage areas.
Importantly, Evolution’s staged funding speeds up completion of the PFS and helps NNLP reach development milestones while lowering capital risk for Surge shareholders. If Evolution completes its full commitment, it will own 32.5% of the JV, but Surge remains the lead partner. This setup means Surge still directs the project, while using Evolution’s operations know-how and resources. With a larger land package and a joint operating committee, NNLP is well on its way to Tier 1 status and is strengthening its spot in North America’s battery metals supply chain – vital for clean energy and EV growth.
Like any mining venture, NNLP faces challenges. Lithium prices fell nearly 90% from their 2022 peak, but from June to September 2025, they rebounded 24%, showing early signs of recovery.
This cyclical pattern reflects Katusa’s “cost floor” concept — production costs in China and Australia now average around $5,000–6,000 per tonne LCE, while South American and U.S. projects need about $8,000/t to stay profitable. If prices fall near those levels, high-cost mines pause output, tightening supply again and stabilizing prices.
Another factor is resource expansion. NNLP’s current resource is inferred, but the company expects to complete its current drilling program at NNLP by the end of October 2025. Once the results are released, the lithium resource will be upgraded from Inferred to Indicated and Measured categories. This step will strengthen confidence in the deposit’s scale and quality, supporting the upcoming Pre-Feasibility Study (PFS).
Permitting and community engagement also remain important; even in a mining-friendly state like Nevada, water use and land reclamation practices must meet strict environmental standards.
Surge Battery Metals has emphasized sustainable practices, including water recycling and progressive site reclamation, as part of its exploration and development plan.
Competition is growing, too. Lithium projects across South America, Australia, and Canada are advancing quickly. Still, Nevada’s combination of stable governance, established mining laws, and proximity to major battery plants gives U.S. projects like NNLP a strong advantage.
A National View: U.S. Lithium Resources and Reserves
The U.S. is home to some of the world’s largest lithium reserves, but it still underdevelops them. According to the U.S. Geological Survey, global lithium reserves total around 21 million tonnes, with the U.S. holding roughly 12%. Nevada alone hosts the country’s biggest lithium resources, concentrated in the Thacker Pass region and the northern claystone belts – where NNLP is located.
Unlocking these resources is vital. Every new project that moves forward strengthens the domestic supply chain and supports national goals to lead in clean energy technology.
Surge Battery Metals plans to continue advancing NNLP through new drilling campaigns and metallurgical studies in 2025. These programs aim to expand and upgrade resources, optimize extraction processes, and confirm the potential to produce battery-grade lithium carbonate with 99.9% purity. The company is also evaluating potential offtake partnerships with battery and automotive manufacturers.
Analysts and investors will be watching for:
Updated resource estimates and grade expansion
Progress toward pre-feasibility studies
Partnerships or funding deals with strategic investors
Regulatory updates supporting U.S. critical mineral development
Positive results in these areas could accelerate NNLP’s move toward construction and help it become one of the first next-generation lithium clay projects to enter U.S. production.
Powering the U.S. Energy Future
The U.S. faces a widening gap between lithium supply and demand that could slow its clean-energy transition. Katusa Research projects a 400,000-tonne global supply shortfall by 2035, roughly the world’s entire 2020 output – a deficit that could keep prices elevated long term.
Source: Katusa Research
Surge Battery Metals’ Nevada North Lithium Project provides a realistic and timely opportunity to help close that divide. With its high-grade resource, strong economics, strategic location, and environmental focus, NNLP could play a central role in building a stable, self-sufficient lithium supply for the United States.
As the nation races to electrify transportation and decarbonize energy, projects like NNLP will be critical. They are not only about producing lithium – they are about powering the next chapter of American industry and ensuring that the clean-energy future is built on secure, sustainable ground.
New Era Publishing Inc. and/or CarbonCredits.com (“We” or “Us”) are not securities dealers or brokers, investment advisers, or financial advisers, and you should not rely on the information herein as investment advice. Surge Battery Metals Inc. (“Company”) made a one-time payment of $50,000 to provide marketing services for a term of two months. None of the owners, members, directors, or employees of New Era Publishing Inc. and/or CarbonCredits.com currently hold, or have any beneficial ownership in, any shares, stocks, or options of the companies mentioned.
This article is informational only and is solely for use by prospective investors in determining whether to seek additional information. It does not constitute an offer to sell or a solicitation of an offer to buy any securities. Examples that we provide of share price increases pertaining to a particular issuer from one referenced date to another represent arbitrarily chosen time periods and are no indication whatsoever of future stock prices for that issuer and are of no predictive value.
Our stock profiles are intended to highlight certain companies for your further investigation; they are not stock recommendations or an offer or sale of the referenced securities. The securities issued by the companies we profile should be considered high-risk; if you do invest despite these warnings, you may lose your entire investment. Please do your own research before investing, including reviewing the companies’ SEDAR+ and SEC filings, press releases, and risk disclosures.
It is our policy that information contained in this profile was provided by the company, extracted from SEDAR+ and SEC filings, company websites, and other publicly available sources. We believe the sources and information are accurate and reliable but we cannot guarantee them.
CAUTIONARY STATEMENT AND FORWARD-LOOKING INFORMATION
Certain statements contained in this news release may constitute “forward-looking information” within the meaning of applicable securities laws. Forward-looking information generally can be identified by words such as “anticipate,” “expect,” “estimate,” “forecast,” “plan,” and similar expressions suggesting future outcomes or events. Forward-looking information is based on current expectations of management; however, it is subject to known and unknown risks, uncertainties, and other factors that may cause actual results to differ materially from those anticipated.
These factors include, without limitation, statements relating to the Company’s exploration and development plans, the potential of its mineral projects, financing activities, regulatory approvals, market conditions, and future objectives. Forward-looking information involves numerous risks and uncertainties and actual results might differ materially from results suggested in any forward-looking information. These risks and uncertainties include, among other things, market volatility, the state of financial markets for the Company’s securities, fluctuations in commodity prices, operational challenges, and changes in business plans.
Forward-looking information is based on several key expectations and assumptions, including, without limitation, that the Company will continue with its stated business objectives and will be able to raise additional capital as required. Although management of the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated, or intended.
There can be no assurance that such forward-looking information will prove to be accurate, as actual results and future events could differ materially. Accordingly, readers should not place undue reliance on forward-looking information. Additional information about risks and uncertainties is contained in the Company’s management’s discussion and analysis and annual information form for the year ended December 31, 2024, copies of which are available on SEDAR+ at www.sedarplus.ca.
The forward-looking information contained herein is expressly qualified in its entirety by this cautionary statement. Forward-looking information reflects management’s current beliefs and is based on information currently available to the Company. The forward-looking information is made as of the date of this news release, and the Company assumes no obligation to update or revise such information to reflect new events or circumstances except as may be required by applicable law.
For more information on the Company, investors should review the Company’s continuous disclosure filings available on SEDAR+ at www.sedarplus.ca.
Disclosure: Owners, members, directors, and employees of carboncredits.com have/may have stock or option positions in any of the companies mentioned: None.
Carboncredits.com receives compensation for this publication and has a business relationship with any company whose stock(s) is/are mentioned in this article.
Additional disclosure: This communication serves the sole purpose of adding value to the research process and is for information only. Please do your own due diligence. Every investment in securities mentioned in publications of carboncredits.com involves risks that could lead to a total loss of the invested capital.
Across Europe, a quiet but decisive shift is reshaping how companies work with their suppliers. As the Corporate Sustainability Reporting Directive (CSRD) comes into force, large organisations are under mounting pressure to disclose detailed, verifiable sustainability information—not only about their own operations, but across their entire value chain. And because up to 80% of a company’s emissions often come from its supply chain, the spotlight naturally turns to SMEs.
Disseminated on behalf of Surge Battery Metals Inc.
Lithium prices have jumped sharply overnight, catching the attention of investors, automakers, and battery makers. In China, lithium carbonate futures on the Guangzhou Futures Exchange hit about 95,200 yuan (≈$13,400 USD) per metric ton. This marks a rebound from earlier lows caused by oversupply.
Historically,lithium prices have been volatile. Peak prices reached around 150,000 yuan per ton in 2022, followed by a slump during the oversupply period in 2023–2024.
The recent spike followed comments from the chairman of Ganfeng Lithium, Li Liangbin, who projected a 30–40% rise in global demand by 2026. He suggested prices could reach between 150,000 and 200,000 yuan per ton if this growth materializes.
The surge highlights lithium’s critical role in powering electric vehicles (EVs) and large-scale energy storage.
Growing Demand for Lithium: What Drives the Boom?
Electric vehicles remain the largest driver of lithium demand. Around 16 million EVs were on the road globally in 2024, up from 10 million in 2022. Sales are forecast to exceed 25 million units by 2026 and reach over 50 million by 2030. Longer-range vehicles require larger batteries, which increases lithium use.
Energy storage systems are another fast-growing source of demand. Utilities expanding solar and wind energy need lithium-based batteries to store surplus electricity. Heavy-duty electric trucks and buses have larger batteries. This means they use morelithium per vehicle compared to passenger EVs.
Long-term trends toward decarbonization andrenewable energy growth further support lithium demand. Analysts say that EV batteries make up about 70% of lithium demand. Grid storage accounts for 15%. Electric trucks use 10%, and other uses, like electronics and specialty chemicals, are around 5%.
Supply Challenges Keep Prices Elevated
Lithium carbonate prices in China have climbed dramatically, moving from $8,259/tonne on June 23, 2025, to $12,791/tonne on November 19, 2025 – a rise of about 55% over five months.
This recent rally is primarily attributed to tight supply conditions, with major Chinese mines, including those operated by CATL, pausing operations due to falling prices earlier in the year. As output was reduced or shut in, inventories were gradually drawn down, tightening available supply.
Moreover, lithium production is highly concentrated. Australia leads with around 60,000 tonnes LCE annually, followed by Chile (35,000 tonnes), China (25,000 tonnes), Argentina (18,000 tonnes), and the U.S. (≈5,000 tonnes). Geographic concentration adds risk: environmental regulations, political tensions, or operational issues could tighten supply.
Restarting idled mines or opening new projects takes 2–5 years. Inventories from the oversupply period act as a buffer. Currentestimates show global lithium stocks at about 350,000 tonnes LCE. This amount can help with short-term supply issues, but it’s not enough for long-term growth.
Lithium makes up about 20–25% of total EV battery costs. So, price changes can greatly impact EV production costs. Also, battery chemistry trends show that sodium-ion andsolid-state batteries might take a small share of the market by 2030. However, lithium-ion will remain the leader for now.
Lithium carbonate prices in China have climbed sharply, as shown in the chart. Prices rose more than 17% this month as investors bet on accelerating demand from the energy storage sector.
Fastmarkets predicts a small surplus in 2025, shifting to a deficit of 1,500 tonnes LCE by 2026. A few years ago, the market had a surplus of about 175,000 tonnes in 2023 and 154,000 tonnes in 2024. Cuts in production at high-cost or marginal mines and rising demand fromEVs and storage systems are driving this rebalancing.
Arcane Capital forecasts global demand could hit4.6 million tonnes LCE by 2030, led by EVs, grid storage, and heavy-duty transport.
Benchmark Mineral Intelligence expects lithium carbonate prices to stay between $15,000 and $17,000 USD per ton in 2025, but prices may be lower in 2026 if supply increases faster than demand.
Still, the chart from Katusa Research highlights a growing deficit in lithium supply and demand. This supply deficit will likely underpin upward pressure on lithium prices moving toward 2030.
Source: Katusa Research
Production in Australia, China, and South America should grow by about 10% each year, per industry estimates. However, delays or cost overruns might slow this growth.
Risks to the Price Recovery
Lithium prices face several risks. EV adoption could slow if subsidies or incentives drop. Battery makers might adopt sodium-ion or other chemistries if costs rise. Rapid restarts of idled mines or new production could oversupply the market.
Regulatory hurdles, environmental restrictions, and trade tensions could also disrupt supply. Recent price spikes were partly due to speculative trading, highlighting the market’s sensitivity to sentiment.
Who Wins and Who Loses?
Higher lithium prices may hurt automakers andbattery makers, pushing them to secure contracts or invest in recycling. Mining companies benefit from higher prices but must manage timelines and costs.
Meanwhile, investors have opportunities, though volatility is high. Policymakers consider lithium a strategic resource and are encouraging domestic production, recycling, and robust supply chains.
With global supply growth uncertain, focus is turning to projects that provide steady, long-term output. This is especially true in areas aiming to boost domestic supply chains, where Surge Battery Metals comes in.
Spotlight: Surge Battery Metals – US Lithium Hero
Surge Battery Metals (TSX-V: NILI | OTCQX: NILIF) is emerging as a key U.S. lithium developer. Its Nevada North Lithium Project (NNLP) hosts the highest-grade lithium clay resource currently reported in the United States, with an Inferred Resource of 11.24 million tonnes of lithium carbonate equivalent (LCE) grading 3,010 ppm lithium (NI 43-101, September 24, 2024).
Source: Surge Battery Metals
A Preliminary Economic Assessment (PEA) on the project outlines robust economics, including:
After-tax NPV₈%: US$9.21 billion
After-tax IRR: 22.8%
Low operating costs: US$5,243 per tonne LCE
NNLP benefits from access to regional infrastructure, including established roads and nearby power, supporting future development.
Surge’s leadership team includes veterans from Millennial Lithium, a company acquired for US$490 million in 2022. The company has also secured a staged C$10 million JV funding agreement with Evolution Mining to advance NNLP toward Pre-Feasibility while maintaining majority ownership.
How Nevada North Fits into the Global Picture
The Nevada North Lithium Project demonstrates the potential to become a globally significant lithium operation. According to comparative analysis from 3L Capital and S&P Global, NNLP’s Life-of-Mine (LOM) average production of 86 kt LCE per year—as outlined in the PEA—would rank the project as the 5th largest lithium-producing project in the world compared with 2024 producers and developers.
Source: Surge Battery Metals
Even in its first year, NNLP is projected to produce 26 kt LCE, placing it among the top 16 lithium projects globally on a 2024 comparative basis. This combination of scale, grade, and location underscores NNLP’s potential as a strategic U.S. supply source in a market seeking domestic, high-quality lithium to reduce dependence on overseas imports.
Source: Surge Battery Metals
If advanced through feasibility, permitting, and construction decisions, NNLP has the potential to become a competitive, American-based lithium operation—supporting both EV manufacturing and large-scale energy storage with “American-made” battery-grade feedstock.
Lithium Surges, Supply Matters, and America Prepares
Prices are shaped by several key factors. These include updates on production from major mines, trends inEV adoption, grid storage deployment, new battery technologies, and changes in policy. Inventory levels and market speculation will continue to influence short-term volatility.
Lithium prices have jumped, signaling a possible market turning point after past oversupply. High demand from EVs, grid storage, and heavy-duty transport, along with limited production and geographic concentration, is pushing prices up.
Industry stakeholders, investors, and policymakers have to monitor developments closely as lithium continues to play a central role in the global energy transition.Surge Battery Metals shows the type of domestic production needed to meet rising demand and strengthen supply chains in a rapidly evolving market.
New Era Publishing Inc. and/or CarbonCredits.com (“We” or “Us”) are not securities dealers or brokers, investment advisers, or financial advisers, and you should not rely on the information herein as investment advice. Surge Battery Metals Inc. (“Company”) made a one-time payment of $50,000 to provide marketing services for a term of two months. None of the owners, members, directors, or employees of New Era Publishing Inc. and/or CarbonCredits.com currently hold, or have any beneficial ownership in, any shares, stocks, or options of the companies mentioned.
This article is informational only and is solely for use by prospective investors in determining whether to seek additional information. It does not constitute an offer to sell or a solicitation of an offer to buy any securities. Examples that we provide of share price increases pertaining to a particular issuer from one referenced date to another represent arbitrarily chosen time periods and are no indication whatsoever of future stock prices for that issuer and are of no predictive value.
Our stock profiles are intended to highlight certain companies for your further investigation; they are not stock recommendations or an offer or sale of the referenced securities. The securities issued by the companies we profile should be considered high-risk; if you do invest despite these warnings, you may lose your entire investment. Please do your own research before investing, including reviewing the companies’ SEDAR+ and SEC filings, press releases, and risk disclosures.
It is our policy that the information contained in this profile was provided by the company, extracted from SEDAR+ and SEC filings, company websites, and other publicly available sources. We believe the sources and information are accurate and reliable but we cannot guarantee them.
CAUTIONARY STATEMENT AND FORWARD-LOOKING INFORMATION
Certain statements contained in this news release may constitute “forward-looking information” within the meaning of applicable securities laws. Forward-looking information generally can be identified by words such as “anticipate,” “expect,” “estimate,” “forecast,” “plan,” and similar expressions suggesting future outcomes or events. Forward-looking information is based on current expectations of management; however, it is subject to known and unknown risks, uncertainties, and other factors that may cause actual results to differ materially from those anticipated.
These factors include, without limitation, statements relating to the Company’s exploration and development plans, the potential of its mineral projects, financing activities, regulatory approvals, market conditions, and future objectives. Forward-looking information involves numerous risks and uncertainties and actual results might differ materially from results suggested in any forward-looking information. These risks and uncertainties include, among other things, market volatility, the state of financial markets for the Company’s securities, fluctuations in commodity prices, operational challenges, and changes in business plans.
Forward-looking information is based on several key expectations and assumptions, including, without limitation, that the Company will continue with its stated business objectives and will be able to raise additional capital as required. Although management of the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated, or intended.
There can be no assurance that such forward-looking information will prove to be accurate, as actual results and future events could differ materially. Accordingly, readers should not place undue reliance on forward-looking information. Additional information about risks and uncertainties is contained in the Company’s management’s discussion and analysis and annual information form for the year ended December 31, 2024, copies of which are available on SEDAR+ at www.sedarplus.ca.
The forward-looking information contained herein is expressly qualified in its entirety by this cautionary statement. Forward-looking information reflects management’s current beliefs and is based on information currently available to the Company. The forward-looking information is made as of the date of this news release, and the Company assumes no obligation to update or revise such information to reflect new events or circumstances except as may be required by applicable law.
Disclosure: Owners, members, directors, and employees of carboncredits.com have/may have stock or option positions in any of the companies mentioned: None.
Carboncredits.com receives compensation for this publication and has a business relationship with any company whose stock(s) is/are mentioned in this article.
Additional disclosure: This communication serves the sole purpose of adding value to the research process and is for information only. Please do your own due diligence. Every investment in securities mentioned in publications of carboncredits.com involves risks that could lead to a total loss of the invested capital.
Canada is at a key moment in its fight against climate change. Carbon pricing has been the central tool used to cut emissions, but recent policy changes and differences across provinces have created uncertainty.
This article examines how Canada’s carbon pricing system works now. It covers expert concerns and what the key federal review in 2026 might mean for both industry and the country’s journey toward a lower-carbon future.
How Canada Prices Pollution
Canada uses carbon pricing to encourage companies and people to cut greenhouse gas (GHG) emissions. Under that system, there are two main parts.
For ordinary people and small businesses, there used to be a “fuel charge” or carbon tax on fossil fuels. For large industrial emitters, there is a program called the Output-Based Pricing System (OBPS).
Under the OBPS, factories or facilities that produce a lot of emissions get a limit based on how much they produce. If they emit more than their limit, they must pay; if they emit less, they earn credits that they can sell or use later.
This approach aims to reduce carbon pollution while trying to protect industries that compete globally. The goal is to cancel out the risk that companies might move to other countries with weaker climate rules.
From Gas Pumps to Smokestacks: A Major Policy Shift
In 2025, the federal government made important changes. It removed the “consumer-facing” carbon tax — the fuel charge — effective April 1, 2025. This means people pay no extra carbon tax when buying gasoline or heating fuel.
Source: RBN Energy LLC website
Instead, the focus shifted more clearly onto industrial carbon pricing. The government said it would review the carbon pricing “benchmark” in 2026. This review could change how industrial carbon pricing operates.
A recent analysis by ClearBlue Markets shows that Canada’s carbon pricing for industry is now fragmented. Fragmentation has caused uncertainty. This is a problem for companies that need stable cost signals before they invest in cleaner technology.
The ClearBlue report stated:
“The federal benchmark review will therefore trigger extensive engagement between the federal government and the provinces, aimed at aligning key benchmark elements such as coverage, pricing stringency, and competitiveness protections. Negotiations are likely to be complex and politically charged, particularly with provinces like Alberta and Saskatchewan, which have already taken strong positions. These types of unilateral decisions reflect ongoing tensions and highlight the difficulty of achieving a truly aligned national approach.”
Carbon pricing today: A patchwork across Canada
Because Canada is large and its provinces have different rules, carbon pricing for industry is not the same everywhere. ClearBlue Markets shows that credit prices—what companies pay or earn—vary a lot by province or system.
Here are specific examples:
In Alberta, the Environmental Monitoring, Evaluation and Reporting Agency has seen a big drop in credits under its Technology Innovation and Emissions Reduction Program (TIER). Despite a compliance price of CAD 95 per tonne, market credits trade at around CAD 18 per tonne. This shows a credit surplus and weak demand.
In British Columbia (B.C.), the new B.C. Output-Based Pricing System (B.C. OBPS) began to be applied recently. Credits are trading at about CAD 65 per tonne, a discount compared with the regulatory level of CAD 80.
In Ontario, the Emissions Performance Standards (EPS) system governs industrial emissions. Because the program does not allow offset credits, supply is tighter — units (EPUs) recently traded at around CAD 72 per tonne.
In areas where the federal OBPS still applies, like some territories and small provinces, cheap carbon offset credits from Alberta’s TIER have lowered prices. Now, they can be as low as about CAD 37.50 per tonne.
Data source: ClearBlue Markets
The true cost of carbon emissions differs greatly by industry and province. The federal government aims to raise the carbon price to CAD 170 per tonne by 2030 for direct pricing systems.
The 2026 Showdown: Can Canada Fix Its Carbon Market?
The upcoming review of the federal benchmark is seen as a turning point. It could lead to stronger, more aligned carbon pricing across all provinces. As ClearBlue Markets notes, the review may address issues such as:
Align different provincial systems under a common design. This way, credits and compliance will act more alike.
Improving transparency in reporting credit inventories, trades, and emission reductions.
Possibly introducing a “floor price” — a minimum cost for carbon credits — to avoid extreme price drops like those seen in some programs.
Setting a long-term carbon price path past 2030 helps industries plan investments more clearly. This is especially important for clean technologies.
All of these could make carbon pricing more predictable and effective. If the review doesn’t meet expectations, patchwork and uncertainty may persist. This could weaken the carbon price signal and confuse investment in clean technology.
This patchwork of provincial and federal carbon pricing programs has created a corresponding patchwork of compliance offset markets. The image below shows how these offset markets are distributed across Canada.
Source: ClearBlue Markets
Global Pressure Is Rising: Europe Could Hit Canada with Carbon Tariffs
One major external risk comes from the global trade environment. Starting in 2026, the European Union’s Carbon Border Adjustment Mechanism (CBAM) will impact imports based on their carbon emissions.
For Canadian exporters, this raises a key question:
Will EU authorities accept the compliance credits or offsets generated under Canada’s various carbon pricing systems as evidence of “carbon price paid”?
If not, Canadian exports might face extra tariffs. This could double the carbon cost or hurt competitiveness.
This makes it even more important for Canada to standardize and strengthen its carbon pricing framework before 2026. This is to ensure that its pricing and credits are recognized internationally. Otherwise, Canadian industries like steel, aluminum, and cement might find it hard to compete. This is especially true in markets with strict climate-related import rules.
Strengths and Challenges of Canada’s Carbon Pricing
Carbon pricing works to link environmental costs with economic decision-making. For large emitters, it encourages improved efficiency. Carbon pricing revenue, especially from the OBPS, can fund clean energy projects. It also supports carbon capture and investments in low-carbon infrastructure.
A recent evaluation by the government highlights that industrial carbon pricing helps reduce emissions with minimal impact on households.
But there are major challenges too. The system varies by province, so many industries might have low carbon costs. This means there is little motivation for real change.
A 2022 report from the Office of the Auditor General of Canada (OAG) found that weak rules in provincial large-emitter programs lower the impact of carbon pricing. Also, the unclear use of carbon revenues and the long-term price outlook have made some firms hesitant to invest in cleaner technologies.
The Stakes: Canada’s Climate Credibility and Industrial Future
The 2026 benchmark review could reshape Canada’s carbon pricing for decades. Key signs to watch are:
Whether the government sets a new, clear carbon price path beyond 2030 — possibly up to 2050, that would give firms confidence to invest in long-term clean solutions.
Whether provincial carbon pricing systems become more harmonized. This means similar rules, credit prices, and transparency everywhere.
Introducing a price floor or other methods can help prevent deeply discounted carbon credits. This ensures a strong carbon price signal.
Will Canadian industrial credits and compliance be set up to gain recognition under global systems like CBAM? This could help keep Canadian exports competitive.
Canada’s carbon pricing, especially for industry, is at a crossroads. The removal of the consumer carbon tax in 2025 reflects a shift toward focusing on industrial emissions. Meanwhile, the upcoming 2026 benchmark review offers a chance to make this system stronger, fairer, and more predictable.
However, much depends on political and regulatory will. Without clear pricing, rules, and long-term certainty, the carbon price might be too weak. This puts Canada’s climate goals and global competitiveness at risk. But if the government and provinces act quickly, carbon pricing can help Canada shift to a low-carbon economy while also keeping industries competitive.
